Back of an envelope

11th October 2006
Recruitment Revolution is the first online recruitment agency, says Jamie Mistlin and Anna Taylor. Will it work?

We’ve all seen the online job boards: Monster, gumtree, Fish4jobs…. But recent graduates Jamie Mistlin and Anna Taylor have laid claim to the first ever online recruitment agency.

“We came up with the idea when we were still at university,” Mistlin says. “I was doing some temping work for £4.50 an hour, and I was shocked when I found out that the recruitment company was skimming off the bulk of my wage. I went to the head of HR and asked if I could apply direct, but they told me they were under contract. I wasn’t even asking for the full wage amount, just a percentage of what the agency was getting: the company could have saved money, and I’d have boosted my earnings.”

This is the business model behind Recruitment Revolution. Mistlin, 27, and girlfriend Taylor, 24, began drawing up a business plan after Mistlin graduated last year. It’s free for companies to list their jobs, browse the CV database and interview candidates. They just pay £400 for each permanent hire they make, and a £2 per hour mark-up on temps. Since national insurance and tax are not charged on earnings of £97 per week or under, there is a lower rate for companies with short-term placements.

The innovation does not stop there. Recruitment Revolution has done the unthinkable: they publish their prices on their website. Agencies everywhere are taking a collective gasp of horror. “We have nothing to hide,” Mistlin says. “We’re completely transparent to both candidates and clients. We can afford to be. We’re proud of our pricing system.”

What makes Recruitment Revolution different from online job boards, and from the websites of High Street agencies, is that it does more than simply host classifieds. The websites provides an entire recruitment service. Recruitment Revolution vets candidates through the electoral register, getting references, NI numbers and photocopies of passports or driving licences. They handle PAYE, provide skills testing and build up individual candidate profiles. And they’ve introduced an Ebay-style feedback system where companies rate their temps. “It’s a bit like Top Trumps without the superpowers,” Mistlin says. “John Smith has typing and web design, punctuality 97 per cent, presentation 92, work productivity 98, work quality 98 and he’s a PowerPoint pro.” Clients can book their chosen candidate straight away, or invite them for interview. Happy companies can even comment on outstanding service. It’s been a unique enough proposition to convince one angel, who’s supplied £250,000 for a 20 per cent stake.

“New job boards, CV databases and recruitment agencies appear weekly,” Mistlin notes. “We do not want to get lost in the swamp, so we need to very quickly inform companies that Recruitment Revolution. com is a first with a stand-alone business model.”

Before they can drum up many corporate clients, though, Recruitment Revolution needs to build a solid candidate base. The firm is targeting students and graduates, and it’s got a whole host of gambits to get them signing up. A bartering system allows candidates to name their terms, effectively saying, “I’m worth more that £10 an hour. I’ll accept £12.” Candidates can also acquire skills with 60 free online courses, from shorthand to HTML. And there’s a referral scheme: sign up your mates, and for every hour they work, you get 50p (which comes out of Recruitment Revolution’s £2 cut).

Mistlin and Taylor spend most of their time policing the jobs and candidates, making sure that all the postings are above board and that companies do not publish contact details. Ironically, given the company’s beginnings, client and candidate cannot speak to one another directly. Recruitment Revolution takes its fee at the end of the process, and they are wary of clients trying to bypass them once a suitable candidate is found.

To cover their back they’ve introduced a loyalty scheme, whereby the candidates can report on any company who tries to cut them out of the loop. The offending client gets charged a higher fee, which is shared with the recruit as a reward for their loyalty. “The Terms and Conditions are our fail-safe,” says Mistlin, “We’ve spent around £10,000 on legal fees to make sure that we are protected.”

They have to be wary of candidates, too. Once a graduate has been booked for a job, it’s down to him to turn up on time and do a good day’s work. Mistlin’s got a fairly easy come-back though: candidates that renege on their contract are booted off the site.

Two months in, the company has filled just ten vacancies. Thirteen jobs were listed when last we checked. Still, it’s early days yet. And with 64 clients signed up, there should be job openings to come. Mistlin’s trying to draw in more potential clients by offering free advertising in exchange for discounts to Recruitment Revolution candidates. Current advertisers include Innocent, Holmes Place, Specsavers and HMV. He predicts these measures will take him to £1m turnover (including candidate wages) within a year, with £300,000 profit. That’s based on assigning 50 temps a week, and 50 permanent places a month – a “conservative” estimate, Mistlin says.

“We’ve got a long way to go,” he openly admits. “There’s a real stigma attached to recruitment agencies, the word ‘recruitment’ in particular. Even I don’t like it. We want to make the point that we’re nothing like the others, we don’t charge exorbitant fees and we don’t make your decisions for you. Recruitment Revolution is like the vicar at a wedding. We don’t get the ‘couple’ together, but we’re there to seal the bond at the end.”



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